Humana Brings Value-Based Care to Independent Practices in 3 States

February 08, 2019 - Humana is helping bring value-based care to independent practices in Louisiana, Pennsylvania, and West Virginia.

The Louisville, Kentucky-based payer announced a new value-based care arrangement with physicians in Aledade’s accountable care organizations (ACOs). Physicians who currently participate in Humana’s Medicare Advantage network will be able to leverage the benefits of the arrangement, including tools and resources both organizations have to deliver value-based care.

“We’re delighted to be able to deliver value-based care to an expanded patient population through this agreement with Humana,” Farzad Mostashari, MD, Co-founder and CEO of Aledade, stated the press release. “Humana shares our dedication to improving patient health and lowering health care costs by empowering independent physicians to thrive in value-based care arrangements.”

Founded in 2014, Aledade partners with independent primary care practices to establish ACOs that participate in a variety of public and private value-based care contracts. The company helps practices participate in the contracts by providing support through data analytics, care management, patient outreach, and regulatory resources.

Value-based care implementation is a major challenge for independent practices.

ACO, bundled payments, and other value-based care arrangements have historically focused on hospital care. Not only is hospital care driving healthcare spending, but the facilities also have the volume and scope to meaningfully participate in various models.

Hospitals also tend to have the financial resources and staffing levels necessary for value-based care success.

In contrast, independent and small practices have limited resources to invest in the technological and workforce infrastructure, causing many practices to forgo value-based care contracts altogether or take a penalty.

For example, small practices in Medicare’s new mandatory Merit-Based Incentive Payment System (MIPS) performed worse compared to their larger peers. Nearly one in five small practices received a negative payment adjustment under the program in the first performance year, and most small practices did not qualify for the exceptional performance bonus.

Some independent practices, however, have found value-based care success by coming together to pool their volumes and resources. Companies like Aledade and independent practice associations allow independent physicians and smaller organizations to partner for the scale necessary for value-based care success.

And some practices are seeing significant clinical and financial improvements. Aledade recently reported that its physician-led ACOs in the Medicare Shared Savings Program improved care quality during the 2017 performance year. Six of the organizations also earned shared savings payments totaling over $19 million.

The recent Medicare Shared Savings Program success prompted Aledade to expand its value-based care model to “more communities, payers, and populations.” Several months later, the company announced its partnership with Humana to bring value-based care to Medicare Advantage beneficiaries.

Humana is also seeing value-based care success by investing in primary care practices. The payer recently found that its value-based care models reduced medical costs by almost 16 percent in 2017 while improving care quality, preventative care, and overall healthcare utilization.

The large payer’s Chief Medical Officer Roy Beveridge attributed the success to investments in primary care.

“When you think about primary care physicians, historically they have been undervalued, underappreciated, and under-resourced,” he recently told RevCycleIntelligence.com. “When we worked with the American Academy of Family Physicians, we found that our data was very consistent with theirs. For non-value-based clinical models, about six percent of the dollar amount goes into the realm of the family practitioners.”

“Given that we believe in the centricity of the family practitioner and the extra amount of work and time that is required for these providers to spend with their patients, we have ensured over the past number of years that we're paying the family practitioners significantly more,” he continued.

In 2017, almost seven percent of every dollar spent by Humana on member care went to primary care physicians. And the percentage increased to 17 percent of every dollar if the physicians were in value-based care arrangements.

The latest contract with Aledade will expand on Humana’s investments in primary care.

Both organizations intend for the value-based care arrangement to cut costs and improve care quality for more Medicare Advantage members.

“Humana is pleased to expand the availability of value-based care in Louisiana, Pennsylvania, and West Virginia,” stated Oraida Roman, Vice President of Humana’s Value-Based Strategies Organization. “This agreement reflects a strong, mutual belief by Aledade and Humana that value-based care is key to enhancing both the patient experience and patient outcomes.”